Gates:
Microsoft Went the Extra Mile to Try to Achieve a Fair and Reasonable
Settlement in Antitrust Lawsuit

Company
Says Settlement Would be Best for Consumers and Industry Future

REDMOND, Wash. -- April 3, 2000 -- Microsoft Chairman Bill Gates
today said that he and team of top company executives worked for the last
four months in an attempt to achieve "a fair and reasonable
settlement" of the antitrust case with the Department of Justice and
various states.

"We went the extra mile to resolve this case, but the government
would not agree to a fair and reasonable settlement that would have
resolved this case in the best interests of consumers and the
industry," Gates said.

Gates said that he had personally devoted hundreds of hours to the
settlement process. He also said that the Microsoft mediation team,
composed of senior executives and lawyers, had devoted more than 3,000
hours to the settlement effort over four months of intense negotiations.

"Obviously, we are not going to discuss the confidential mediation
process," said Gates. "But I can say that Microsoft offered
significant concessions in the interest of ending this case. Ultimately,
it became impossible to settle because the Department of Justice and the
states were not working together. Between them, they appeared to be
demanding either a breakup of our company or other extreme concessions
that go far beyond the issues raised in the lawsuit."

Microsoft entered into settlement discussions with the DOJ and states
in late 1999, after U.S. District Court Judge Thomas Penfield Jackson
proposed a process mediated by Seventh Circuit Court of Appeals Chief
Judge Richard Posner. The talks continued until Judge Posner announced
today that the parties had negotiated to an impasse.

"Bill and I and our entire executive team invested countless hours
in the mediation process, because we believe that a settlement would be
good for everyone," said Microsoft President and Chief Executive
Officer Steve Ballmer. "We continue to believe that we have a strong
legal case, and that the judicial system will ultimately rule in our
favor. We would prefer to resolve this case through settlement, but we
must protect our right to bring the best products for consumers to the
fast-changing marketplace."

Both Gates and Ballmer had high praise for the efforts and
professionalism of Judge Posner.

"Judge Posner deserves a lot of credit for his incredible effort,
insights and tenacity throughout this process. Judge Posner did everything
he possibly could, and then some," Gates said.